No More Maximizing De Minimis

No More Maximizing De Minimis

The Big Beautiful Bill sure is hard to appreciate under all that shade. So I went digging to find a way to UNFILTER its glow.

When you’re panning through 900 pages of dense legislative text, it’s all too easy to overlook a nugget of gold. I'm here to extract that nugget: the de minimis clause that, thanks to COVID shutdowns and lack of access to normal consumer channels, became the pandemic-exploited pipeline for unchecked, unsafe imports.

What is de minimis? It’s a legal exemption that allows any shipment valued under $800 to bypass standard U.S. import procedures — including duties, tariffs, formal customs entry, and most FDA or CPSC inspections. Originally designed to ease the burden on small shipments, it now functions as a fast lane for mass imports that avoid regulation entirely.

In 2016, roughly 150 million de minimis parcels slipped in duty-free.
By 2022, that swelled to 685.4 million.
In 2024, we crossed 1.3 billion—3.8 million a day, each one skating past tariffs, inspections, and basic safety checks.

On April 2, 2025, Executive Order 14256 slammed the door on de minimis for China and Hong Kong—zapping tariff breaks and informal entry routes—yet testing and real oversight stay frozen until 2027.
(Somewhere, someone’s already plotting that southern-border shuffle. 😉)

Peel Back That Filter

De minimis began life in the Tariff Act of 1930 as a $200 carve-out for tiny shipments. In 2016, President Obama bumped it to $800 via the Trade Facilitation and Enforcement Act—intended to help small businesses while tightening rules on forced-labor imports.

But when COVID slammed retail and choked our ports, importers discovered a back-door lifeline. Shipments surged six-fold, regulators barely noticed, and our freight trucks went from neat pallets of wrapped and sorted merchandise to heaps of unsorted, detergent-soaked boxes to unload at 3 AM.
(Yes, I swapped my office heels for forklift steel-toes and saw it myself.)

The Tiny Clause with a Mighty Bite

H.R. 1 doesn’t just whisper “close the loophole”; it crushes it in two precise phases:

• August 3, 2025
Section 70531(a) adds a new subsection to 19 U.S.C. § 1321, imposing fines for misuse of de minimis (i.e. splitting shipments or false claims)

• July 1, 2027
Section 70531(b) strikes the de minimis carve-out in 19 U.S.C. § 1321(a)(2)—completely abolishing the exemption for commercial shipments and requiring every parcel to clear full customs entry and mandatory FDA/CPSC safety testing before release.

Why this matters: By pushing importers back toward consolidated, larger shipments, it forces imports back through proper regulatory channels, aligns staffing with volume, and strengthens safety oversight across the board. It also levels the playing field between importers attempting to compete with rogue foreign manufacturers.

What’s Happening to Those Shipments Now?

• Duty & Entry: Since May 2, parcels from China/HK enter under full customs entry—adding a 30 percent ad valorem tariff plus a $25 processing fee.

• FDA Oversight Today: All FDA-regulated parcels under $800 now require Prior Notice + Entry Type 86 (formulation, origin, consignee). Over 1,200 importers have joined FDA’s FSVP this quarter.

• CPSC Sampling Today: CPSC may sample micro-parcels, but only about 5 percent of suspect toys get pre-release testing due to backlog.

• Full Testing & Regulation (July 1, 2027): Every cosmetics, electronics, and children’s product parcel must pass FDA’s micro-inspection protocols and CPSC’s hazard tests before clearance.

But Are the Referees Ready?

Passing the rule is one thing; enforcing it is another. On the front lines:

• CBP is stretched thinner than tortilla chips at happy hour, managing waves of new entries with limited staff.
• FDA built blockbuster-level muscle but is racing to downscale for micro-parcel reviews—backlogs still run months deep.
• CPSC boasts grand toy-safety plans, yet testing queues remain cavernous.

Without at least a 30 percent boost in budgets and personnel across these agencies, this regulatory victory could fizzle into a sleepy compliance checkbox.

The Collective Win

Businesses will always chase loopholes. It’s how industries grow teeth. But regulators? Their job is to make sure those teeth don’t bite the hand that buys—or the one that builds.

And now, with this bill? We’ve got a rare alignment moment. A chance for regulators, retailers, and the rest of us who click “Buy Now” at midnight to agree on one thing: safety shouldn’t be a loophole.

Sure, it took a global import explosion and 1.3 billion barely-checked packages to get here—but hey, we made it. Kind of.

The question isn’t whether business can adapt (they will, grumpily). It’s whether regulators can move fast enough to keep up—before the entire supply chain turns into a choose-your-own-adventure novel written in invisible ink.

So let’s give credit where it’s due: this clause is small, but it’s doing the work. And it’s finally addressing the chaos we’ve normalized.

Not because we’re killjoys.
Not because we hate a bargain.
But because safety is sexy—and finally something we can all agree on.

Let’s unfilter that glow, baby. It’s been dimmed long enough.